The Government has set up a Committee under the Chairmanship of Shri Shilabhadra Banerjee to review the whole gamut of processes, practices and procedures being followed for procurement and finalisation of security sensitive items relating to currency, e.g., ink, paper, equipment and security features.
The detailed recommendations made by the Committee are:
Review of Security Features of Indian Bank Notes.
• A permanent body in MoF called the Directorate of Currency (DoC) may be created for review & acquisition of security features and would be responsible for driving R & D, act as a clearing house for research and be repository of knowledge on the subject.
Acquisition of Security Features:
• The Review Committee has proposed the introduction of an acquisition system that DoC would implement in a manner that promotes greater transparency and accountability.
Review of Procurement Manual of SPMCIL and BRBNMPL
• The procurement manuals should be revised after laying down PQB guidelines to promote competition , manner and criteria for evaluating samples, revision of tender documents providing level playing field to both Indian and foreign suppliers. For procurement of bank note paper, single tender should be floated for all denominations.
Indigenisation :
• The Review Committee noted that currently steps have been taken to augment indigenous capacity for production of Bank note Paper that would meet a major part of the pcountry’s requirement in the next 3-4 years. Considering this development, capacity addition in future should envisage the participation of Indian Private Sector with or without Joint Venture with foreign entities.
• An R&D Centre at the National Level under DoC should be set up for research and development in the field of raw materials, security features and machinery required for the production of Bank Notes and other security sensitive items.
• For undertaking applied research and process innovation at unit level, R&D set-up should be created and funded by SPMCIL and BRBNMPL related to their field of activities.
• The security paper manufactured in India may be exempt from excise duty. Further, financial incentives like waiver of customs duty on imported machinery and other tax incentives may be granted to encourage indigenous bank note paper production and printing.
Other Issues –
• A single agency at the National Level to coordinate the activities of intelligence, law enforcement and investigating agencies engaged in the task of countering the menace of FICN would be desirable.
• RBI may consider launching a sustained and widespread multi-media campaign for educating the public on how to easily distinguish genuine bank notes from fake ones.
The Committee recommended waiver of custom duty on imported machinery for Bank Note Paper production and printing, and the Government has decided to extend an concessional customs duty rate on specified machineries for this purpose.
This information was given by the Minister of State for Finance, Shri Namo Narain Meena in written reply to an Unstarred Question in Lok Sabha today.
